1. State Bank of India – The VRS Story
By:
Harshala Salunke (Roll No.86)
Mahesh Toraskar (Roll No. 112)

2. Site Map Overview Competition Right sizing Strategy (VRS)
Reason for redesigning the VRS
Post VRS Scenario
Consequences
Conclusion

3. Overview Origin – Establishment 1806 State bank group
1-State Bank of Bikaner and Jaipur (SBBJ) 2-State Bank of Hyderabad (SBH) 3-State Bank of Indore (SBIR) 4-State Bank of Mysore (SBM) 5-State Bank of Patiala (SBP) 6-State Bank of Saurashtra (SBS) 7-State Bank of Travancore (SBT)

4. Overview SBI India’s largest public sector bank In terms of—
Reach-Network of branches
Customer Base-Revenue
Experience-Workforce

5. Services Offered

6. Paradigm Shift Technological Advancements -Computerization
-Internet Banking
-ATM’s
Banking Dynamics

7. Competition Comparison between SBI & some NPBs. Bank
NPAs /NET Advances
Profit per employee(Rs.in mn)
SBI
7.18%
0.43
HDFC
0.77%
0.96
UTI
4.71%
0.69
ICICI
1.53%
0.78
GTB
0.87%
1.2
IDBI
1.95%
1.15

8. Right sizing Strategy (VRS)
To protect business
To remain profitable
To reduce cost of operations
To get rid of the dead woods

9. VRS Package & response
Eligibility – 15 Years of service / greater than 40 years as on March 31,2000
60 Days of Salary for every completed year of service or salary to be drawn by for the remaining period of service whichever is lower.
Total 35,000 Applications
19,295 were officer ( 33 % of Total Officers)

10. Reason for redesigning the VRS
To restrict the huge out flow of officers
Competence gain by competitor
To maintain balance between workforce
Process
Fixing age bar (increased to 55yrs from 40 Yrs)
Eligibility criteria
Criticism
Formation of SBIVRS optee Officers Association

11. Post VRS Scenario SBI merge 440 loss making branches
Reduced regional offices from 10 to 1 or 2
A single officer had to take care of 3 or 4 branches
Acute manpower shortage in departments like internal audit, monitoring, inspection of borrowers
Lost experts to competitors

12. Consequences POOR HR POLICY Stress Among employee VRS outcome Reason
Shortage of
Man power
Stress Among
employee
POOR HR
POLICY
VRS outcome
Reason
Required more
Working capital
Increase
workload

13. Conclusion SBI objective of VRS were defeated
To get rid of the dead wood
Improve functioning of organisation
The VRS strategy demoralized and demotivated the existing employee by fear of increasing work load

14. THANK YOU